News U Can Use
March 1, 2019
The Week that was…
February to 1
Indian Economy
Government data showed that the growth forecast of the Indian economy for FY19 was
downgraded to 7% as compared to a growth rate of 7.2% in FY18. This puts India's growth
rate at a five-year low for the current fiscal. The growth estimate of the Indian economy for
the period from Oct to Dec of 2018 was estimated to have slowed down to 6.6% from 7.0%
in the previous quarter. This was the slowest rate of growth in as many as six quarters.
The growth of eight core sectors slowed for the third consecutive month to 1.8% from 2.7%
in the previous month and 6.2% in the same month of the previous year. The slowdown
came as growth in crude oil sector and refinery product sector remained in contractionary
mode over the month and fell 4.3% and 2.6% respectively.
The Nikkei India Manufacturing Purchasing Managers' Index (PMI) rose to 54.3 in Feb
2019 from 53.9 in Jan 2019 driven by sharp increase in sales that boosted growth of
output and employment. This marked a 14-month high. Inflows of new work at Indian
goods producers continued to expand during Feb 2019 due to advertising efforts,
supportive government policies and strengthening demand conditions.
Government data showed that India’s fiscal deficit for the period Apr 2018 to Jan 2019
came in at Rs. 7.71 lakh crore, or 121.5% of the budgeted target for FY19 as against
113.7% in the year-ago period. Net tax receipts were Rs. 10.2 lakh crore or 68.7% of the
budget estimate for FY19 compared with 76.5% in the corresponding period of the
previous year.
Indian Equity Market
Domestic Equity Market Indices
Indices 01-Mar-19 1 Week Return YTD Return
S&P BSE Sensex 36,063.81 0.54% -0.01%
Nifty 50 10,863.50 0.67% 0.01%
S&P BSE Mid-Cap 14,502.82 2.35% -6.06%
S&P BSE Small-Cap 13,981.73 3.43% -4.93%
Source: MFI Explorer
NSE Advance/Decline Ratio
Date Advances Declines
Advance/Decline Ratio
25-Feb-19 1111 691 1.61
26-Feb-19 610 1188 0.51
27-Feb-19 849 955 0.89
28-Feb-19 1076 697 1.54
01-Mar-19 1432 380 3.77
Source: NSE
Indian equity markets closed on a
positive note. However, domestic
geopolitical tensions had kept the
markets under pressure for most part of
the week. Reports that the finance
minister has assured government
funding support to state-owned banks
also boosted market sentiment. Decline
in crude oil prices on worries over
surge in U.S. crude inventory added to
the gains.
Further, the U.S. President announced
that the deadline to increase tariffs on
imports from China could be extended,
which supported buying interest. Also,
he stated that the two countries have
made considerable progress in trade
talks. Upbeat global cues after the U.S.
Federal Reserve chairman iterated that
the central bank will be patient while
hiking rates in the future also
contributed to the upside.
Nifty 50
Mid Cap
Small Cap
26.53 26.49 31.19 -113.42
3.02 3.43 2.51 2.12
Dividend Yield
1.19 1.24 1.01 0.92
Source: BSE, NSE Value as on Mar
1, 2019
Indian Equity Market (contd.)
Sectoral Indices
Last Returns (in %)
Closing* 1-Wk 1-Mth
S&P BSE Auto
18,925.93 1.71% -0.31%
S&P BSE Bankex
30,321.99 0.76% -0.30%
21,499.15 1.02% 0.40%
17,321.48 3.01% -0.81%
11,411.57 0.59% -2.87%
13,887.16 2.22% -0.79%
15,359.68 1.65% -0.48%
S&P BSE Metal
10,935.23 2.49% 3.72%
S&P BSE Oil & Gas
13,937.45 2.22% 2.23%
S&P BSE Power
1,848.83 1.92% -2.07%
S&P BSE Realty
1,796.11 -1.19% -0.09%
Source: Thomson Reuters Eikon
*Value as on Mar 1, 2019
On the BSE sectoral front, indices closed on
a positive note. S&P BSE Capital Goods was
the major gainer, up 3.01% followed by S&P
BSE Metal that grew 2.49%. Gains in metal
stocks likely reflect optimism over progress of
trade talks between U.S. and China. S&P
BSE Oil & Gas and S&P BSE Healthcare
each grew 2.22%.
Decline in crude oil prices likely gave boost to
the oil and gas sector. S&P BSE Power and
S&P BSE Auto grew 1.92% and 1.71%,
respectively. However, S&P BSE Realty was
the only loser that fell 1.19%.
Indian Derivatives Market Review
Nifty Mar 2019 Futures were at 10,917.05, a premium of 53.55 points, over the spot
closing of 10,863.50. The total turnover on NSE’s Futures and Options segment for the
week stood at Rs. 53.99 lakh crore as against Rs. 44.09 lakh crore for the week to Feb 22.
The Put-Call ratio stood at 0.92 compared with the previous week’s close of 0.88.
The Nifty Put-Call ratio stood at 1.69 against the previous week’s close of 1.37.
Domestic Debt Market
Debt Indicators
Call Rate
6.20 6.34 6.43 6.41
91 Day T-Bill
6.42 6.43 6.55 6.81
7.80% 2021, (5 Yr GOI)
6.68 6.76 6.92 7.79
7.17% 2028, (10 Yr GOI)
7.56 7.60 7.61 7.95
Source: Thomson Reuters Eikon
Value as on Mar 1, 2019
Bond yields fell after domestic
geopolitical tensions eased to some
extent. Yields fell further on
speculations that the Indian Monetary
Policy Committee may again cut
interest rate in the upcoming meeting
in Apr 2019 following lower than
expected economic growth.
Yields on the existing 10-year
benchmark paper (7.17% GS 2028)
fell 4 bps to close at 7.56% from the
last week’s close at 7.60%, after
trading in a range of 7.55% to 7.70%.
Yield on the upcoming 10-year
benchmark paper (7.26% GS 2029)
fell 3 bps to close at 7.38% as
compared with the previous session’s
close of 7.41% after trading in the
range of 7.36% to 7.51%.
25-Feb 26-Feb 27-Feb 28-Feb 1-Mar
Yield in %
10 -Yr Benchmark Bond ( % )
Source: CCIL
Domestic Debt Market (Spread Analysis)
G-Sec Yield
Corporate Yield
1 Year 6.67 8.19 152
3 Year 6.88 8.39 151
5 Year 7.17 8.30 113
10 Year 7.70 8.77 107
Source: Thomson Reuters Eikon Value as on Mar 1, 2019
Yields on gilt securities fell across 4 to 11
years’ maturities and 14-year paper by up to
14 bps. Yield increased across the
remaining maturities by up to 6 bps barring
1- and 13-year papers that closed steady.
Corporate bond yields fell across 4 to 8
years’ maturities by up to 22 bps. Yields
increased across the remaining maturities in
the range of 2 bps to 9 bps barring 1-year
paper that closed steady.
Difference in spread between AAA corporate
bond and gilt contracted across 4 to 7 years’
maturities in the range of 4 bps to 14 bps.
and expanded across the remaining
maturities in the range of 2 bps to 10 bps
barring 1-year paper that closed steady.
3 Mths 6 Mths 1 Yr 5 Yrs 10 Yrs 20 Yrs 30 Yrs
India Yield Curve Shift (%) (W-o-W)
Change in bps 01-Mar-19 22-Feb-19
Yield in %
Change in
Source: Thomson Reuters Eikon
Regulatory Updates in India
The Securities and Exchange Board of India (SEBI) allowed mutual funds and portfolio
managers to invest in commodity derivatives. The move is expected to bring boost to the
commodities market. The market regulator has also reduced fees payable by brokers to Rs.
10 per Rs. 1 crore of transactions from Rs. 15 earlier, and those by brokers for agri-
commodities derivatives by 93.33% to Re. 1 per Rs. 1 crore of transaction from Rs. 15
According to media reports, SEBI revised rules for open offer exemptions for corporates
that are undergoing debt restructuring. SEBI will revise its norms for valuing money market
and debt securities to make the process transparent and smooth. Also, the market regulator
approved easing of norms for raising of funds through instruments like real estate and
infrastructure investment trusts.
According to media reports, SEBI stated that asset management companies cannot pay
upfront commission for Systematic Investment Plans (SIPs) registered prior to Oct 22,
2018. The regulator, however, has directed AMCs to pay distributors withheld commission
within three months.
Regulatory Updates in India (contd..)
The Union cabinet approved a national policy on software products. The policy aims to
position India as a hub for software products development and to create 65 lakh jobs by
2025. The policy will look after 10,000 technology start-ups working on software products.
The Union cabinet cleared a Rs. 10,000-crore programme under the Faster Adoption and
Manufacturing of (Hybrid) and Electric Vehicles (FAME)-II scheme for a period of three
years effective from Apr 1, 2019. The main objective of the scheme is to encourage faster
adoption of electric and hybrid vehicles by giving upfront incentive on purchase of electric
vehicles (EV) and by establishing necessary charging infrastructure for EV.
SEBI is thinking of adopting ‘regulatory sandbox’ approach that will help to make best use of
new technologies such as blockchain and artificial intelligence in the securities markets.
Regulators in major financial markets have established ‘regulatory sandbox’ for promoting
financial technology and adoption.
As per media reports, the Food processing ministry is working on Gram Samridhi Yojana
that will promote the unorganised food processing sector concentrated in rural areas.
Global News/Economy
U.S. Federal Reserve chief delivered his semi-annual monetary policy report to Congress in
which he emphasized patience on further interest rate hikes. He told lawmakers that the U.S.
economy remains healthy but warned of potential headwinds. The U.S. Fed chief specifically
pointed to volatility in the financial markets toward the end of 2018 and also cited slowing
economic growth in foreign countries, particularly China and Europe, as well was uncertainty
about Brexit and ongoing trade talks between the U.S. and China.
According to a report from the Commerce Department, U.S. real gross domestic product
grew 2.6% in the fourth quarter of 2018 as against growth of 3.4% in the third quarter 2018.
U.S. GDP growth came in higher than market expectations.
A report from Eurostat showed that eurozone inflation came in line with market expectations
and was 1.5% in Feb 2019 as against 1.4% in Jan 2019. Meanwhile, excluding energy, food,
alcohol and tobacco, the core inflation rate slowed to 1% in Feb 2019 as against 1.1% in Jan
A report from the IHS Markit showed that U.K.’s Purchasing Managers' Index for
manufacturing fell to 52 in Feb 2019 as against 52.6 in Jan 2019. This marked the weakest
level in four months.
Global Equity Markets
Global Indices
Dow Jones
26,026.32 -0.02% 11.57%
Nasdaq 100
7,151.57 0.86% 12.98%
FTSE 100
7,106.73 -1.00% 5.63%
DAX Index
11,601.68 1.26% 9.88%
Nikkei Average
21,602.69 0.83% 7.93%
Straits Times
3,220.40 -1.51% 4.94%
Source: Thomson Reuters Eikon
Value as on Mar 1, 2019
U.S. markets largely remained positive
with buying interest supported by the
U.S. President’s intention to postpone a
planned increase in U.S. tariffs on
Chinese imports.
Market sentiments found further support
after U.S. economic growth came better
than expected in the fourth quarter of
Most of the European markets witnessed modest gains with investors taking positive cues
on key political developments over Brexit. Investor sentiment were also buoyed after
White House Economic Advisor said that U.S. and China are making significant progress
in their trade negotiations. China has expressed willingness to make key structural
changes to prevent intellectual property theft.
Asian markets witnessed mixed trend during the week. Market sentiment was boosted on
reports of significant progress in the trade negotiation between U.S. and China. However,
an abrupt end of the U.S. North Korea Summit without an agreement on the
denuclearization of the Korean peninsula weighed on the market sentiment.
Global Debt (U.S.)
Yields on the 10-year U.S. Treasury
bond rose 10 bps to close at 2.76%
compared with the previous close of
U.S. Treasury prices fell on stronger
than expected U.S. Gross Domestic
Product data for the fourth quarter of
2018. U.S. real GDP grew 2.6% in the
fourth quarter of 2018 as against market
expectations of 2.3% increase.
Additionally, announcement by the U.S.
President to postpone an increase in
tariffs on Chinese imports from Mar 1
deadline also reduced the safe haven
appeal of the U.S. Treasuries.
However, expectations that the U.S.
Federal Reserve will remain patient on
increasing interest rates in 2019 and
data showing widening of U.S. trade
deficit in Dec 2018 restricted further
25-Feb 27-Feb 1-Mar
Yield in %
US 10-Year Treasury Yield Movement
Source: Thomson Reuters Eikon
Commodities Market
Performance of various commodities
Last Closing* 1-Week Ago
Brent Crude($/Barrel) 63.15 67.45
Gold ($/Oz) 1,293.31 1,327.71
Gold (Rs/10 gm) 32,819 33,252
Silver ($/Oz) 15.20 15.92
Silver (Rs/Kg) 39,195 40,121
Source: Thomson Reuters Eikon *Value as on Mar 1, 2019
Gold prices moved down following
upbeat U.S. GDP data for the last
quarter of 2018. Further, the U.S.
President said that he would delay his
plans for increasing tariffs on Chinese
goods which added to the losses.
However, downside was limited
following a fall in Chinese manufacturing
activity for Feb 2019.
Brent Crude
Brent crude prices plunged on
increasing U.S. crude inventory.
However, downside was limited
following reports that the Organization
of the Petroleum Exporting Countries
and its allies will continue trimming oil
supply to tighten the oil market.
Baltic Dry Index
The Baltic Dry Index rose on the back of
improved capesize and panamax
1-Feb-19 15-Feb-19 1-Mar-19
Global Commodity Movement
Gold Spot ($/Oz) Silver Spot ($/Oz) Brent ($/bbl)
Global Commodity Prices
Rebased to 10
Source: Thomson Reuters Eikon
Currencies Markets
Movement of Rupee vs Other Currencies
Currency Last Closing* 1-Wk Ago
US Dollar
70.97 71.22
Pound Sterling
94.09 92.83
80.72 80.75
100 Yen
63.49 64.29
Source: RBI Figures in INR , *Value as on Mar 1, 2019
The Indian rupee rose against the
greenback as domestic geopolitical
tensions eased to some extent. Gains in
the domestic equity market also aided
the rupee.
The euro rose against the greenback
after the U.S. President decided to delay
the proposed tariff hikes on Chinese
imports. Gains were extended after the
U.S. Federal Reserve chief emphasised
patience on raising U.S. interest rates.
The pound surged against the greenback
as concerns about a disorderly 'no-deal'
Brexit eased to some extent.
The yen weakened against the
greenback as its safe haven appeal
dwindled after the U.S. President
decided to delay the proposed tariff hikes
on Chinese shipments.
1-Feb-19 15-Feb-19 1-Mar-19
Source: RBI
Currency Prices ( in terms of INR)
Rebased to 10
Currency Movement
The Week that was…
February to 1
The Week that was (Feb 25 Mar 1)
Date Events
February 25, 2019
U.S. Wholesale Inventories (MoM) (Dec P) 1.10% 0.40%
February 26, 2019
India Fiscal Deficit (Apr-Jan 2019) 121.50% 113.70%
U.S. Consumer Confidence Index (Feb) 131.4 121.7
U.S. Housing Starts (Dec) 1,078k 1,214k
February 27, 2019
U.S. Advance Goods Trade Balance (Dec) -$79.5b -$70.5b
U.S. Factory Orders (Dec) 0.10% -0.60%
Japan Industrial Production (YoY) (Jan P) 0.00% -1.90%
Japan Retail Trade (YoY) (Jan) 0.60% 1.30%
February 28, 2019
India Gross Domestic Product (GDP) (3Q) 6.60% 7.00%
India Eight Core Sector (Jan) 1.80% 2.70%
China Manufacturing PMI (Feb) 49.20 49.50
German Consumer Price Index (YoY) (Feb P) 1.60% 1.40%
U.S. Gross Domestic Product Annualized (QoQ) (4Q A) 2.60% 3.40%
March 01, 2019
India Manufacturing PMI (Feb) 54.30 53.90
U.S. ISM Manufacturing (Feb) 54.20 56.60
U.S. ISM Employment (Feb) 52.30 55.50
Eurozone Consumer Price Index Estimate (YoY) (Feb) 1.50% 1.40%
Germany Unemployment Claims Rate (Feb) 5.00% 5.00%
The Week Ahead
March to 8
The Week Ahead
Day Event
March 4, 2019
U.S. Durable Goods Orders (Jan P)
U.S. Housing Starts (MoM) (Jan)
U.S. Construction Spending (MoM) (Dec)
March 5, 2019
India Nikkei Services PMI (Feb 19)
U.S. ISM Non-Manufacturing/Services Composite (Feb)
Japan Nikkei Services PMI (Feb)
U.K. Markit/CIPS Services PMI (Feb)
March 6, 2019
Germany Markit Construction PMI (Feb)
U.S. Trade Balance (Dec)
U.S. Factory Orders (Jan)
March 7, 2019
European Central Bank Rate Decision
Eurozone Gross Domestic Product (YoY) (4Q F)
U.S. Initial Jobless Claims (Mar 02)
March 8, 2019
U.S. Change in Non-farm Payrolls (Feb)
U.S. Unemployment Rate (Feb)
China Trade Balance CNY (FEB)
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